The bears were in firm control of the NBP market on Monday, with a well-supplied system and healthy supply outlook weighing on prompt and curve contracts

Gas Market

The NBP’s confidence in its ability to meet demand in the face of below normal temperatures and the loss of Russian gas via Ukraine was building yesterday as both prompt and curve prices took a tumble. An oversupplied system and a healthy renewable presence in the power stack weighed on the Spot market, with Within Day falling by 6.75p day-on-day. Meanwhile, Day ahead made the biggest loss of the session, decreasing by 7.23p to close at 117.00p per therm. A downward revision to temperatures for next week had limited impact on prices, with gas storage levels across Europe currently standing at 69.9% fullness, while there are also six LNG cargoes expected to arrive into the U.K. by January 11th. The healthy supply outlook fed into losses across the near curve, with February-25 falling by 5.91p to close out the session at 117.91p per therm.  

Power Market

A decisive downward shift across the NBP prompt and curve pressured GB Baseload prices down on Monday. Near months averaged losses of £5.06/MWh day-on-day while the front month contract fell by 5.5% to close the session at £97.13/MWh. The prompt market was also in decline despite a further downward revision to both temperatures and wind generation levels, with the Day ahead contract declining by 18.5% day-on-day. European carbon prices fell on Monday, tracking the overall weakness across natural gas markets. The Dec-25 EUAs fell by €1.84 to settle at €74.30 a tonne, while UK Allowances for Dec-25 also fell by £1.40 to close the day at £35.26 a tonne.  

Oil Market

Despite a volatile session, oil prices traded sideways on Monday, with Brent seemingly determined to remain within touching distance of its highest closing level since mid-October. The front month contract settled at $76.30 a barrel, down just 21 cents day-on-day. Colder weather in the Northern Hemisphere, which spurred buying activity, a weaker U.S. dollar and expectations of tighter sanctions on Iranian and Russian oil exports, are all keeping crude prices elevated. Intra-day volatility was driven by reports that President-elect Trump’s administration may limit tariffs to only critical imports when he enters the White House later this month, however these reports were subsequently denied.  

Markets this morning

Monday’s losses have continued into this morning with all traded contracts going through below their previous close. Day ahead last went through at a 1.50p discount to Monday’s settlement despite a forecasted significant decrease in windspeeds from tomorrow until early next week. The front month contract is also down by 2.41p day-on-day, driven by a renewed sense of confidence in the supply scenario. Oil prices have continued to edge sideways, with front month Brent adding a 22 cent premium on yesterday’s close. Gains have been supported by tighter Russian and Iranian supply due to expanding Western sanctions.